US v. Saundra Lucille White (4th Cir. Filed 3/9/17): Franks Hearings and Sentencing Enhancements for Misrep’s to the Government and Sophistication

March 13th, 2017
Elizabeth Franklin-Best

In the world of white-collar crime, this is quite the scam. Ms. White is convicted of numerous counts of various kinds of fraud in connection with her impersonating and then swindling an invalid woman from her assets. This case is not particularly sympathetic, and she sought a trial. One of her claims involves her entitlement to a Franks v. Delaware hearing[1]. When the first witness took the stand (and the person who initially hired White to care for her victim), she made statements that were nominally at odds with statements contained in the search warrant.  As assignment of error, White alleges the district court erred in not granting her a hearing to challenge the warrant.

The Court notes that the Franks test has 3 parts– to obtain a Franks hearing, a defendant must make a “substantial preliminary showing” that the affiant made (1) a false statement (2) “knowingly and intentionally, or with reckless disregard for the truth” that was (3) “necessary to the finding of probable cause.”  Id. at 155-56.

The Government argued White did not preserve this issue since she did not request the Franks hearing prior to trial.  Federal Rules of Criminal Procedure 12(b) requires defendants to make suppression requests, like Franks hearings, before trial “if the basis for the motion is then reasonably available.”  Fed. R. Crim. P. 12(b)(3).  Since the basis for her request was this witness’s testimony, which was not “reasonably available “before trial, id., the Court found she did not waive her right to request the hearing.

However, her claim fails on its merits.  The Court found the witness’s statements were “at best” “inconsistent versions with varying degrees of certainty…about communications that occurred” over two years prior.  But also, even without the challenged statements, sufficient probable cause existed to support the search warrant.  Claim denied:

The district court did not err in finding that White failed to make the requisite showing for a Franks hearing.  First, White cannot point to a false statement.  Hiler’s trial testimony dd not contradict Agent David’s assertions that (1) Hiler discussed Millner with White at her home and (2) Hiler knew White had a home office from which she conducted business. Hiler’s acknowledgment on redirect that she had conversations regarding Millner with White at White’s home– no matter how fleeting– comport with Agent David’s statements in the affidavit.

Additionally, White cannot establish the requisite scienter (White did not offer any proof that Agent Davids intentionally, or recklessly included a false statement into the affidavit).

White also challenged the reasonableness of her sentence.  She argued the district court erred in applying (1) a two- level enhancement for misrepresenting a government agency, and (2) a two-level enhancement for sophisticated meas.  She also argued the district court should have reduced her sentence based on her psychological diagnosis (which was redacted in this opinion).

The Guidelines allow an enhancement when a fraud “involved a misrepresentation that the defendant was acting on behalf of…a government agency.”  USSG 2B1.1(b)(9)(A)(2014).  The court found this applied because of (1) the fraudulent tax statements White created that induced the victim’s guardian to remit money to her, and (2) the voicemail in which an unidentified person claimed to be an official tax collector for the US Department of Treasury and the State of Maryland.  The Court rejected these arguments finding that this conduct clearly falls within the conduct the statute is designed to prohibit.

The Guidelines also allow an enhancement when fraud involves “especially complex or especially intricate offense conduct pertaining to the execution or concealment of an offense.  2B1.1 cmt. 9(B) “Conduct such as hiding assets or transactions, or both, through the use of fictitious entities…also ordinarily indicates sophisticated means.  A quick look at the facts of this case shows that this argument didn’t have a CHANCE.  These frauds included getting duplicate licenses, a counterfeit university ID, she created fictitious entities and bank accounts.  She created fraudulent tax notices, she forged signatures, she shuttled money around accounts.   This case if far from one of garden-variety fraud.

And lastly, as for her psychological issues.  The Court reviewed the record and concluded the lower court did not abuse its discretion is not allowing a downward variance based on her diagnoses (about which there appears to have been considerable disagreement).

But seriously, 108 months for this conduct which involved swindling more than $800,000 from an invalid woman seems more than fair.

what-to-do-with-instant-financial-wealth-u3

[1]           438 U.S. 154 (1978).

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